Irish Tax on Online Gambling Faces More Delays

One of the great things about Bitcoin is that it is international by design. A Bitcoin user has access to Bitcoin no matter where they are on Earth, and can spend it anywhere on Earth equally easily. Unfortunately, the regulations on Bitcoin are far from international themselves, and specific regulations can impose specific burdens and inconveniences in certain jurisdictions.

One example is the Irish gambling tax, which has been delayed yet again, making it a full four years since the tax was originally proposed, back in 2011. The 1% tax on electronic bets placed within Ireland now won’t take effect until sometime in 2015. Gambling is legal in Ireland, roughly speaking, but is taxed. The taxes have been slow to catch up to online gaming, though, simply due to the newness and internationality of the process.

The delay was caused by concern that it introduced ambiguity over which jurisdiction a company ought to be taxed by. These sorts of issues come up more frequently in the EU, which is a mess of overlapping jurisdictions, sometimes tense political, geographical, and economic relationships, and very, very old legal systems.

Finance Minister Michael Noonan seemed irked by the new delay, and had this to say about the issue:

“As soon as the standstill period is completed, it is my intention to progress all remaining stages of the Bill through the Oireachtas […] I share the Deputy’s frustration at the delays involved in progressing the Bill.”

The bill would primarily affect a few of the larger online casinos. Reuters quotes one such bookmaker, “Paddy Power,” who says that the bill would have cost them seven million euros last year, or about 5% of their total pre-tax profit. However, Bitcoin casinos operating in Ireland like Flutterclub or serving Irish customers would also be affected by the tax, potentially complicating their legal responsibilities.

The much-delayed tax comes in the wake of an increased drive to tax online gambling in Europe. London is scheduled to raise taxes on high-stakes gambling machines, and pass new laws preventing gambling companies from incorporating offshore to avoid gambling taxes. These sorts of taxes and regulations, as they grow, are likely to push gamblers out of regulated waters and into the anonymous side of Bitcoin games, exposing them to what entertainment is like using cryptocurrency.